Originally Posted by AustinChief
PLEASE educate yourself.
I bolded the part that is correct in this regard (although the "principal" is simply bonds reaching maturity which doesn't matter since you simply issue more bonds to cover that). The US didn't make a "loan" to defense contractors, nor did it loan money to Food Stamp recipients nor does it loan money to the people who work for the FDA. The LOAN we would default on (should Obama chose to) are T bills (and you can maybe stretch and throw in Social Security) we have plenty of money to make these payments. What you are talking about are making payments to other programs and services that are nOT OBLIGATED payments. Just because you REALLY WANT to keep playing paintball or giving to charity doesn't make it an OBLIGATION requiring the credit card company to raise your limit.
I can't post links
But you can see US entities own 68% of the debt. And this is for fiscal year 2012. Social Security owns the second major chunk totaling around 2.6 Trillion.
Another question would you buy corporate bonds if they defaulted recently on their previous bonds? In other words: don't pay back. Would you like to own T-bills? They pay no interest compared to other loans and bonds because they are supposed to be safe, I mean the chances of a government defaulting are slim to none, right? So after they default people gonna buy them up like hotcakes is what you are saying